What are the best investment avenues for Retail Investor?
Investments are meant for long term. Broadly stocks and Mutual Fund qualify for long term investment
- Stocks: Ideal if you have time and passion to research information
- Mutual Fund: Hire a professional fund manager
Do Insurance products make sense for investing?
Insurance is best to cover the pure risk and investment should not be mixed. So unit-linked plans are not desirable and hence keep investing separate from Insurance
Is gold the best Investment?
Gold is a hedge against inflation and has a currency hedge as well. But the chances to generate real return are difficult. So at best have 5-10% allocation of your overall portfolio
How about investing in Bonds & FD?
Bonds do offer good yields when compared to FD but the risk assessment rests with you completely. However few tax-free bonds and AAA-rated bonds should be good enough. However one has to take care of concentrated holding since bonds are not that retail as Mutual fund investments
Fixed deposit is a good short- term investment solutions but very less attractive from a taxation point of view. Also, liquidity is another factor to consider before investing in FD as the high deposit rates are offered for 3 and 5-year term which again removes the tax benefit one would get if he were to choose bonds or debt Mutual fund over it.